scholarly journals Comparing the effects of behaviorally informed interventions on flood insurance demand: an experimental analysis of ‘boosts’ and ‘nudges’

2019 ◽  
pp. 1-31 ◽  
Author(s):  
JACOB BRADT
Keyword(s):  
Experimental Analysis ◽  
Sufficient Conditions ◽  
Individual Risk ◽  
Flood Insurance ◽  
Demand For Insurance ◽  
Risk Beliefs ◽  
Contingent Valuation Survey ◽  
Low Probability ◽  
Labor Pool ◽  
Online Labor

AbstractThis paper compares the effects of two types of behaviorally informed policy – nudges and boosts – that are designed to increase consumer demand for insurance against low-probability, high-consequence events. Using previous findings in the behavioral sciences literature, this paper constructs and implements two nudges (an ‘informational’ and an ‘affective’ nudge) and a statistical numeracy boost and then elicits individual risk beliefs and demand for flood insurance using a contingent valuation survey of 331 participants recruited from an online labor pool. Using a two-limit Tobit model to estimate willingness to pay (WTP) for flood insurance, this paper finds that the affective and informational nudges result in increases in WTP for flood insurance of roughly $21/month and $11/month relative to the boost, respectively. Taken together, the findings of this paper suggest that nudges are the more effective behaviorally informed policy in this setting, particularly when the nudge design targets the affect and availability heuristics; however, additional research is necessary to establish sufficient conditions for this conclusion.

scholarly journals Influence of flood risk characteristics on flood insurance demand: a comparison between Germany and the Netherlands

2013 ◽  
Vol 13 (7) ◽  
pp. 1691-1705 ◽  
Author(s):  
I. Seifert ◽  
W. J. W. Botzen ◽  
H. Kreibich ◽  
J. C. J. H. Aerts
Keyword(s):  
The Netherlands ◽  
Flood Risk ◽  
Risk Perceptions ◽  
Private Insurance ◽  
Insurance Coverage ◽  
Individual Risk ◽  
Flood Insurance ◽  
Insurance Demand ◽  
Information Campaigns ◽  
Demand For Insurance

Abstract. The existence of sufficient demand for insurance coverage against infrequent losses is important for the adequate function of insurance markets for natural disaster risks. This study investigates how characteristics of flood risk influence household flood insurance demand based on household surveys undertaken in Germany and the Netherlands. Our analyses confirm the hypothesis that willingness to pay (WTP) for insurance against medium-probability medium-impact flood risk in Germany is higher than WTP for insurance against low-probability high-impact flood risk in the Netherlands. These differences in WTP can be related to differences in flood experience, individual risk perceptions, and the charity hazard. In both countries there is a need to stimulate flood insurance demand if a relevant role of private insurance in flood loss compensation is regarded as desirable, for example, by making flood insurance compulsory or by designing information campaigns.

Expanding the National Flood Insurance Program to Cover Coastal Erosion Damage

2003 ◽  
Vol 35 (3) ◽  
pp. 639-647 ◽  
Author(s):  
Andrew Keeler ◽  
Warren Kriesel ◽  
Craig Landry
Keyword(s):  
Management Strategies ◽  
Nationwide Survey ◽  
Flood Insurance ◽  
National Flood Insurance Program ◽  
Erosion Damage ◽  
Considerable Uncertainty ◽  
Demand For Insurance ◽  
Insurance Program ◽  
Property Owners ◽  
The Cost

This paper uses the results of a nationwide survey of coastal property owners to estimate the demand for insurance against erosion damage. The National Flood Insurance Program (NFIP) does not technically cover such damage, although in practice there is considerable uncertainty about this point. The ability to insure against such losses has implications for the choice of beach management strategies and for NFIP management. We find significant demand for insurance at prices in the range of current flood insurance premiums, although median willingness to pay appears to be less than the cost of providing such insurance.

AN ECONOMIC PREMIUM PRINCIPLE UNDER THE DUAL THEORY OF THE SMOOTH AMBIGUITY MODEL

2017 ◽  
Vol 47 (3) ◽  
pp. 787-801 ◽  
Author(s):  
Yoichiro Fujii ◽  
Hideki Iwaki ◽  
Yusuke Osaki
Keyword(s):  
Ambiguity Aversion ◽  
Sufficient Conditions ◽  
Exchange Economy ◽  
Comparative Statics ◽  
Ambiguous Loss ◽  
Dual Theory ◽  
Demand For Insurance ◽  
Smooth Ambiguity Model ◽  
Pure Exchange ◽  
Pure Exchange Economy

AbstractThis study considers a pure exchange economy with insurance against ambiguous loss. Ambiguity preferences are represented by the dual theory of the smooth ambiguity model from Iwaki and Osaki (2014). The economic premium principle of Bühlmann (1980, 1984) is extended to ambiguity. We also perform some comparative statics and present sufficient conditions under which an increase in ambiguity aversion increases insurance demand and insurance premiums. Contrary to the result in Tsanakas and Christofides (2006), the optimal demand for insurance is not always comonotonic, because our model permits an economy comprising both ambiguity averse and ambiguity loving agents.

scholarly journals Host condition and individual risk of cowpox virus infection in natural animal populations: cause or effect?

2009 ◽  
Vol 137 (9) ◽  
pp. 1295-1301 ◽  
Author(s):  
P. M. BELDOMENICO ◽  
S. TELFER ◽  
L. LUKOMSKI ◽  
S. GEBERT ◽  
M. BENNETT ◽  
...  
Keyword(s):  
Body Condition ◽  
Case Control Study ◽  
Individual Risk ◽  
Cowpox Virus ◽  
Poor Condition ◽  
Animal Populations ◽  
Good Body Condition ◽  
Low Probability ◽  
Nested Case Control ◽  
Control Study

SUMMARYRecent studies have provided evidence that endemic pathogens may affect dynamics in animals. However, such studies have not typically considered that infected individuals might have a preceding underlying poor condition. We examined whether individuals in poor condition are more likely to become infected by an endemic pathogen, using as a system the dynamics of cowpox virus in field voles. With data from monthly sampled vole populations, a nested case-control study evaluated whether susceptible individuals with poorer condition had higher probabilities of contracting cowpox. The influence of condition was found to be considerable, especially for males. At times when a susceptible male with good body condition had a relatively low probability of becoming infected, a susceptible male with poor body condition was twice as likely to contract cowpox; if this male was also anaemic, the chances were almost quadrupled. We discuss the care needed when interpreting the findings of wildlife disease studies.

scholarly journals An Appropriate Way to Switch from the Individual Risk Model to the Collective One

1993 ◽  
Vol 23 (1) ◽  
pp. 23-54 ◽  
Author(s):  
S. Kuon ◽  
M. Radtke ◽  
A. Reich
Keyword(s):  
Risk Model ◽  
Sufficient Conditions ◽  
Approximation Error ◽  
Individual Risk ◽  
Risk Models ◽  
Approximation Quality ◽  
Collective Risk Model ◽  
Collective Risk ◽  
The Individual ◽  
Necessary And Sufficient

AbstractFor some time now, the convenient and fast calculability of collective risk models using the Panjer-algorithm has been a well-known fact, and indeed practitioners almost always make use of collective risk models in their daily numerical computations. In doing so, a standard link has been preferred for relating such calculations to the underlying heterogeneous risk portfolio and to the approximation of the aggregate claims distribution function in the individual risk model. In this procedure until now, the approximation quality of the collective risk model upon which such calculations are based is unknown.It is proved that the approximation error which arises does not converge to zero if the risk portfolio in question continues to grow. Therefore, necessary and sufficient conditions are derived in order to obtain well-adjusted collective risk models which supply convergent approximations. Moreover, it is shown how in practical situations the previous natural link between the individual and the collective risk model can easily be modified to improve its calculation accuracy. A numerical example elucidates this.

scholarly journals Optimal Retention for a Stop-loss Reinsurance Under the VaR and CTE Risk Measures

2007 ◽  
Vol 37 (1) ◽  
pp. 93-112 ◽  
Author(s):  
Jun Cai ◽  
Ken Seng Tan
Keyword(s):  
Value At Risk ◽  
Negative Binomial ◽  
Risk Model ◽  
Sufficient Conditions ◽  
Individual Risk ◽  
Risk Models ◽  
Optimization Criteria ◽  
Collective Risk Model ◽  
Collective Risk ◽  
Stop Loss

We propose practical solutions for the determination of optimal retentions in a stop-loss reinsurance. We develop two new optimization criteria for deriving the optimal retentions by, respectively, minimizing the value-at-risk (VaR) and the conditional tail expectation (CTE) of the total risks of an insurer. We establish necessary and sufficient conditions for the existence of the optimal retentions for two risk models: individual risk model and collective risk model. The resulting optimal solution of our optimization criterion has several important characteristics: (i) the optimal retention has a very simple analytic form; (ii) the optimal retention depends only on the assumed loss distribution and the reinsurer’s safety loading factor; (iii) the CTE criterion is more applicable than the VaR criterion in the sense that the optimal condition for the former is less restrictive than the latter; (iv) if optimal solutions exist, then both VaR- and CTE-based optimization criteria yield the same optimal retentions. In terms of applications, we extend the results to the individual risk models with dependent risks and use multivariate phase type distribution, multivariate Pareto distribution and multivariate Bernoulli distribution to illustrate the effect of dependence on optimal retentions. We also use the compound Poisson distribution and the compound negative binomial distribution to illustrate the optimal retentions in a collective risk model.

Ultrasound criteria for managing postpartum patients with suspicion of retention of conception products

2019 ◽  
Vol 61 (2) ◽  
pp. 276-281
Author(s):  
Orna Levinsohn-Tavor ◽  
Noa Feldman ◽  
Ran Svirsky ◽  
Noam Smorgick ◽  
Arava Nir-Yoffe ◽  
...  
Keyword(s):  
Ultrasound Examination ◽  
Individual Risk ◽  
Clinical Approach ◽  
Retained Products Of Conception ◽  
Products Of Conception ◽  
Ultrasound Findings ◽  
Low Probability ◽  
Specific Symptoms ◽  
Retained Products

Background Retention of conception products is a common complication following delivery and remains a diagnostic and management challenge due to non-specific symptoms and ultrasound findings. Purpose To introduce a clinical approach for managing patients with suspected retained products of conception following delivery. Material and Methods The ultrasound examination included gray-scale and Doppler parameters which classified the patients into three groups: high, moderate, or low probability for retained products of conception. The same classification was used both to stratify individual risk for retained products of conception, as well as for counseling the appropriate management. Results The study included 66 patients. Retained products of conception was confirmed in 62%, 32% and 0% of the high, moderate and low probability groups, respectively. Additionally, each group was further divided according to the timing of the ultrasound examination: before or after 42 postpartum days. A significant increase, from 12% to 64%, in the positive predictive value was observed in the moderate probability group when the ultrasound was performed ≥ 42 days postpartum. Conclusions In the low probability group, no surgical intervention is recommended. When ultrasound findings are classified as high probability for retained products of conception, surgical evacuation of the uterine content is recommended. For clinically stable women with ultrasound findings consistent with moderate probability, ultrasound follow-up at the end of the puerperal period (42 days) is recommended. This approach may improve the sonographic prediction of retained products of conception and prevent unnecessary interventions.

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